Rental Property Investor · El Paso, TX · Member since 2018 · 1 post · 0 votes
I’m a first time landlord and I’m screening possible tenants. I have 3 qualified applicants but yesterday I received an offer from a 4th one. They’re willing to do a 6 month lease and pay the 6 months upfront since they just moved to town and husband is currently unemployed. It’s tempting to me since I will not have to worry about them not paying on time, but I want to hear people’s experiences with these kind of tenants. In advance, thank you.
Investor · Shelton, WA · Member since 2017 · 6k+ posts · 6k+ votes
5y
@Oswaldo Rascon bad tenants know that landlords are easily distracted when you offer them some free green up front. Not saying that is the case here; but it is a serious red flag to many of us.
Here is one scenario.......true story BTW. You take the money and tenant moves in (or their friend does). For six months there is no need for contact. You send them a lease renewal they hem and haw and stall and more time goes by-but they paid rent. You go over there for the renewal ring the bell, and it is answered by the Hound of the Baskervilles!
The tenants have been cooking meth in your house for six months and you are in no position to evict. A drug house will have to be taken down to the studs and it will cost you 60k to get it ready for the next tenant.
BTW if you had stuck to your screening process you could have uncovered their flaws, background check, credit check, social media, prior LL, and employment verification. I know LL's who don't check any of these things. Sometimes they get lucky other times not so much. Nothin wrong with cash up front just check it out as though it was not there. All the best!
Key to this is your accounting and realization of revenue when services are rendered. Other than that, there really isn't a lot of downside. The one thing I will say is that see what the rental market history is like 6 months from now if they decided to move out and you need to find a new tenant. Is it strong during that time of the year? If it is slow and units sit on the market for months you might be better off getting someone who will do a 1 year lease.
Is it credit issues or criminal history that has caused them to offer six months up front? Or is it simply the unemployment? If your lease is 6 months and they don't have serious issues like violence, destruction of property, etc...go for
Investor · Shelton, WA · Member since 2017 · 6k+ posts · 6k+ votes
5y
@Oswaldo Rascon bad tenants know that landlords are easily distracted when you offer them some free green up front. Not saying that is the case here; but it is a serious red flag to many of us.
Here is one scenario.......true story BTW. You take the money and tenant moves in (or their friend does). For six months there is no need for contact. You send them a lease renewal they hem and haw and stall and more time goes by-but they paid rent. You go over there for the renewal ring the bell, and it is answered by the Hound of the Baskervilles!
The tenants have been cooking meth in your house for six months and you are in no position to evict. A drug house will have to be taken down to the studs and it will cost you 60k to get it ready for the next tenant.
BTW if you had stuck to your screening process you could have uncovered their flaws, background check, credit check, social media, prior LL, and employment verification. I know LL's who don't check any of these things. Sometimes they get lucky other times not so much. Nothin wrong with cash up front just check it out as though it was not there. All the best!
Investor · Tampa, FL · Member since 2017 · 589 posts · 251 votes
5y
I'm with Bjorn on this one. That is a lot to come up with up front and put towards rent. Stick to your guns and if they are willing to pay that much then they shouldn't miss a beat month.